OECD defends raising taxes on energy groups

The secretary general of the OECD was in favor of a provisional increase in taxes on energy companies with the aim of financing measures that relieve consumers, fully affected by the rise in prices, which has been accentuated by the war in Ukraine.

“In the short term (…) there is capacity to increase the level of taxes in that sector and redirect some of those profits to measures to cushion the impact of rising electricity prices on consumers,” Mathias Cormann said on Monday. during an economic forum in Madrid.

“This has been done in Italy and Romania” and “we encourage governments to seriously consider it”, in view of the benefits reaped by the large groups in the sector, continued the head of the Organization for Economic Cooperation and Development.

Energy prices have increased considerably in recent months, driven by strong demand brought about by the reactivation of the economy after the COVID-19 epidemic. This dynamic accelerated sharply after the start of the war in Ukraine on February 24, especially in the European Union.

To deal with the situation, most European countries have put in place measures to try to reduce the bill for households and businesses. But these initiatives have a heavy cost for public finances, in States often weakened by a large public debt.

In France, the government has estimated the cost of measures to tackle rising prices at 22 billion euros (about $24.1 billion). In Spain, on your side, it should be between 10,000 and 12,000 million euros in 2022.

To finance these measures, several countries, such as Italy, said they are considering taxing the profits made by producers as a result of price increases. The Spanish government had already announced a similar measure last fall, but finally had to review its decision in the face of criticism from the giants in the sector.

Beyond short-term measures, the OECD secretary general deemed it necessary to increase efforts to “guarantee security of supply”, especially in the European Union, which is highly dependent on Russian oil and gas. “It’s clearly a structural problem,” he insisted.

The OECD, which brings together all the developed countries, announced at the end of February that it had suspended Russia’s accession process and will close its office in Moscow in retaliation for the Russian invasion of Ukraine.